uploads///Telecom Q Market Capitalization

AT&T Has a Low Valuation

Ambrish Shah - Author
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Dec. 4 2020, Updated 10:51 a.m. ET

AT&T’s scale

As of March 25, the market capitalization for AT&T (T) was $224.2 billion, making it the second-largest US mobile operator in terms of market capitalization. In comparison, Verizon (VZ) had a market capitalization of $248.3 billion, Sprint’s (S) market capitalization was $25.7 billion, and T-Mobile’s (TMUS) market capitalization was $61.5 billion.

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Forward EV-to-EBITDA valuation

On March 25, AT&T had a trailing-12-month EV-to-EBITDA (enterprise value-to-earnings before interest, tax, depreciation, and amortization) ratio of 6.95x. Verizon, Sprint, and T-Mobile had trailing-12-month EV-to-EBITDA multiples of 7.60x, 4.71x, and 7.66x, respectively. On March 25, AT&T was trading at a 12-month forward EV-to-EBITDA ratio of 6.69x. Verizon, T-Mobile, and Sprint had 12-month forward EV-to-EBITDA multiples of 7.38x, 6.87x, and 4.51x, respectively.

Forward PE valuation

A company’s PE ratio tells us the amount investors are willing to pay per dollar of earnings per share. On March 25, AT&T was trading at a 12-month forward PE ratio of 8.57x. Verizon, T-Mobile, and Sprint had 12-month forward PE multiples of 12.81x, 17.86x, and 147.07x, respectively.

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